Australia continues to deny freedom of movement to a former intelligence officer who revealed that Canberra bugged government offices in the small island nation of Timor-Leste, in an effort to secure a lucrative oil deal. The former intelligence officer, known only as “Witness K.”, is believed to be a former director of technical operations in the Australian Secret Intelligence Service (ASIS), Australia’s foreign-intelligence agency. In 2013, he publicly objected to an intelligence-collection operation that targeted the impoverished Pacific island nation of Timor-Leste, known also as East Timor.

According to Witness K., a group of ASIS officers disguised themselves as members of a renovation crew and planted numerous electronic surveillance devices in an East Timorese government complex. The inside information collected from those devices allegedly allowed the Australian government to gain the upper hand in a series of complex negotiations that led to the 2004 Certain Maritime Arrangements in the Timor Sea (CMATS) treaty. The treaty awards Australia a share from profits from oil exploration in the Greater Sunrise oil and gas field, which is claimed by both Australia and East Timor. But in 2013, the East Timorese government took Australia to the Permanent Court of Arbitration in The Hague, claiming that the CMATS treaty should be scrapped. The East Timorese claimed that during the sensitive negotiations that preceded the CMATS treaty, the Australian government was in possession of intelligence acquired through ASIS bugging.

The claim of the East Timorese government was supported by Witness K., who argued that ASIS’ espionage operation was both “immoral and wrong” because it was designed to benefit the interests of large energy conglomerates and had nothing to do with Australian national security. But as soon as the East Timorese told the Permanent Court of Arbitration that they would be questioning a witness from ASIS, officers from the Australian Security Intelligence Organisation (ASIO), the country’s domestic intelligence agency, raided the Canberra law offices of Bernard Collaery, East Timor’s lawyer in the case. The raiders took away documents that disclosed the identity of Witness K., and then proceeded to detain him for questioning. They also confiscated his passport, which prevented him from traveling to the Netherlands to testify in the case. Read more of this post

The government of North Korea uses intermediary firms in Singapore to import thousands of tons of Russian oil each year, according to a senior North Korean defector who has spoken publicly for the first time since his defection. Ri Jong-ho was a senior official in the Democratic People’s Republic of Korea under its previous leader, the late Kim Jong-il. He rose through the ranks of the Workers’ Party of Korea and was directly mentored by Kim, who personally appointed him to a post in Bureau 39. The powerful body is in charge of securing much-needed foreign currency for Pyongyang —often through illegal activities— and partly funds the personal accounts of the ruling Kim dynasty.

From the mid-1990s until his 2014 defection, Ri spent nearly three decades in senior positions inside the DPRK. These included the chairmanship of the board of the Korea Kumgang Group, a state-managed firm that oversees large-scale economic activity in North Korea, such as constructing energy networks and commissioning oil and natural-gas exploration. Between 1998 and 2004, Ri lived in the Chinese city of Dalian, where he headed the local branch of the Korea Daesong Trading Corporation. The Pyongyang-based company facilitates North Korea’s exports to China in exchange for Chinese goods and products.

But Ri’s mentor, Kim Jong-il, died in 2011. His son and successor, Kim Jong-un, engaged in a brutal campaign to remove his father’s advisers and replace them with his own people. During that time, said Ri, thousands of senior and mid-level officials were purged, some physically. Frightened and disillusioned, Ri defected with his family to South Korea in October 2014; fifteen months later, in March 2016, he arrived in the United States. On Tuesday, the Voice of America published Ri’s first public interview since his defection.

Among other things, the former Bureau 39 official said that the North Korean regime sustains itself with the help of oil it imports from nearby countries. One of the regime’s main sources of energy is Russia, which supplies Pyongyang with between 200,000 and 300,000 tons of oil every year. But the trade does not occur directly, said Ri. Moscow sells the oil to energy-trading companies in Singapore. These mediators then sell the oil to the DPRK through separately agreed contracts, so that Russia does not appear to be providing Pyongyang with desperately needed oil. The so-called “Singapore line” was established by North Korea in the 1990s, said Ri, and appears to still be active. In addition to Russian oil, the DPRK imports approximately 500,000 tons of oil per year from China, through pipelines, according to Ri.

Recently uncovered documents shed further light on an ultra-secret plan, devised by the British and American governments, to destroy oil facilities in the Middle East in the event the region was invaded by Soviet troops. The documents, published on Thursday by George Washington University’s National Security Archive, were found in the British government archives and date from 1951 to 1955. They describe a top-secret United States plan known as NSC 26/2, which was approved by the National Security Council in 1949 and authorized by President Harry Truman. The plan aimed to prevent the use of Middle East oil facilities by Soviet troops if the latter were able to successfully invade the region.

American documents from the 1950s describe NSC 26/2 as a “denial policy”, which called for a secret collaboration between Middle East-based American and British oil companies. The goal was to sabotage or completely destroy oil facilities and equipment that were in British and American hands, before the Soviets could take them over. The most sensitive part of the plan was the need to keep it secret from the governments of Middle Eastern countries like Iran, Iraq, and Saudi Arabia, even though most of them were allies of the West at the time.

The existence of NSC 26/2 was first revealed in 1996, when the American newspaper Kansas City Star published an extensive article about it, written by Steve Everly. But the recently unearthed British documents shed more light than ever before on the intelligence aspects of the secret plan. Specifically, they reveal the leading role played by the Central Intelligence Agency in implementing the details of the plan in nearly every Middle Eastern country, including Kuwait, Bahrain, Qatar, Iran, Iraq, and Saudi Arabia. As part of the plan, the CIA systematically inserted what the National Security Archive describes as “undercover operatives” into posts in American and British oil companies. Their mission was to collect inside information and recruit other oil employees to facilitate the requirements of NSC 26/2. In essence, says the National Security Archive, the CIA created “a paramilitary force ready to execute the denial policy”.

Some of the documents also show that American and British leaders discussed the possibility of bombing —in some cases using nuclear weapons— some oil facilities in countries like Iraq and Iran that were state-owned and thus had no Western connections. In 1953, NSC 26/2 was updated and replaced with NSC 176, which was later renamed NSC 5401. The plan continued to call for the destruction of oil facilities in the Middle East, using “direct action”, if they were close to being seized by Soviet troops.

Syrian and American media are reporting that Russian engineers, employed by a Moscow-based contractor with close ties to Russian President Vladimir Putin, are working at a Syrian gas plant under the control of the Islamic State. The facility in question is the so-called Tuweinan gas plant, which is located in central Syria, approximately 60 miles (40 kilometers) southwest of the city of Raqqa. The Islamic State declared Raqqa its capital shortly after occupying it, in June 2013, and the city has since served as the militant group’s administrative headquarters. The nearby Tuweinan gas plant is believed to be the largest of its kind in Syria. In 2013, it was occupied by an alliance of factions operating under the banner of the Al-Nusra Front, the primary al-Qaeda affiliate in Syria. But in early 2014, Islamic State forces took control of the plant following a military offensive against Al-Nusra.

The plant was built by Russian construction company Stroytransgaz, which was awarded the contract in 2007 by the government of Syrian president Bashar al-Assad. It is important to note that Stroytransgaz is owned by Gennady Timchenko, a Russian oligarch who is believed to have close ties to President Putin. Following Russia’s involvement in Ukraine, the United States Department of the Treasury imposed sanctions on the construction company, accusing it of having “direct links” with the inner circle of the Russian government. Since that time, a subcontractor of Stroytransgaz, known as Hesco, which is owned by George Haswani, a Russian national of Syrian descent, has been employed by the parent company to help in the completion of the Tuweinan plant. Haswani, who holds dual Russian and Syrian nationality, was recently singled out by the US Tresury for allegedly “brokering the transfer of oil” between the Assad regime in Damascus and the Islamic State.

In October 2014, the anti-Islamic State website Raqqa Is Being Slaughtered Silently reported that a group of Russian engineers employed by Stroytransgaz subcontractor Hesco had been given permission by the Islamic State to continue working at the plant. On Tuesday, US-based review Foreign Policysaid it had spoken to “Turkish officials and Syrian rebels”, who claimed that the Russian engineers were still at the Tuweinan plant. The sources told Foreign Policy that the Russian engineers had been tasked with completing the construction of the facility, as promised in 2007, but this time with the permission of the Islamic State. The latter needs the plant to remain operational. Both Stroytransgaz and Hesco have denied the allegations. The Russian government has not commented on the case.

By JOSEPH FITSANAKIS | intelNews.org
The Islamic State has lost control of approximately 95 percent of its oil production capacity following the advancing Iraqi counteroffensive, according to a leaked German intelligence report. Last June, a massive offensive by armed members of the Islamic state, also known as the Islamic State of Iraq and al-Sham (ISIS), conquered much of northern Iraq, including the cities of Mosul and Tikrit. As the crumbling Iraqi army kept hastily retreating south, ISIS forces encountered almost no resistance during their onslaught.

In the past two months, however, a large-scale counter-offensive by Iraqi forces and irregular Shiite militias, supported by Iran and the United States, has reclaimed much of the land previously occupied by ISIS. Earlier this month, Iraqi forces recaptured the strategically located city of Tikrit, in a move that is widely viewed as the greatest victory so far for the anti-ISIS forces.

Along with Tikrit, Iraqi forces have managed to recapture a number of oil fields, which provided ISIS with a lucrative source of income for much of the past year. On Thursday, German broadsheet Süddeutsche Zeitungcited a leaked intelligence report that claimed ISIS had lost control of “a minimum of three oil fields” in northern Iraq. The Munich-based newspaper said it had seen a report on the subject authored by the Bundesnachrichtendienst, or BND, Germany’s external intelligence agency. According to the report, the Iraqi counteroffensive had reclaimed all but one of the ISIS-controlled oil fields in the country.

The BND documents state that the ISIS government now only controls the Qayara oil field, located in Iraq’s southeastern Nineveh province. The oil field’s daily output capacity of around 2,000 barrels leaves ISIS with only “five percent of the extraction capacity” it had before the Iraqi counteroffensive, says the paper. Moreover, satellite images taken last March show that retreating ISIS forces set fire to two of the largest oil fields in their possession, the Ajil and Himrin facilities. That, according to the BND, shows that ISIS were themselves pessimistic about being able to reclaim these oil fields from the Iraqi forces.

By JOSEPH FITSANAKIS | intelNews.org
At least one of the two men arrested in Poland last week for spying for a “foreign entity” was working on a project of strategic significance, aimed at reducing Poland’s dependency on Russian natural gas. Polish media reported last Wednesday that a colonel in the Polish Army had been arrested by security personnel for acting as an unregistered agent of a foreign country. Subsequent media reports said a second man, a lawyer with dual Polish-Russian citizenship, had also been arrested. Later in the day, an official statement from the office of the Senior Military Prosecutor said simply that Poland’s Ministry of National Defense had “detained a Polish Army officer on suspicion of being a member of a foreign intelligence service”. But there was no mention of the country for which the detained men allegedly spied for. This past Saturday, Reuters revealed that the two men were suspected of spying for Russia. The news agency cited Marek Biernacki, a Polish parliamentarian, who is also a member of the Polish Parliament’s Committee on Intelligence and had allegedly been briefed by Polish intelligence officials about last week’s arrests. Biernacki told journalists that the actions relating to the two detainees had been “taken in respect of two agents of the Russian state”. In accordance with Polish law, the public prosecutor named the civilian detainee as Stanislaw Sz., using only his first name and the first two letters of his last name. Reuters said the man had been employed at the well-connected law firm of Stopczyk & Mikulski, whose website listed him until recently as an employee. Stanislaw Sz. was allegedly involved in a project to construct a coastal terminal in Swinoujscie, located on Poland’s Baltic Sea coast, for importing liquefied natural gas. The import terminal, which is scheduled to become operational in 2015, will allow Poland to import gas from the Persian Gulf. That will in turn reduce the country’s heavy dependence on imported Russian natural gas at a time when Warsaw’s relations with Moscow continue to deteriorate. Reuters said that the precise nature and timing of Stanislaw Sz.’s involvement with the Swinoujscie terminal is unclear, but it characterized the project as being of strategic importance for both Poland and Russia. Read more of this post

By JOSEPH FITSANAKIS | intelNews.org |
A leaked geopolitical study authored by German intelligence sees the United States as the primary beneficiary of the world’s drastically changing energy balance. The report, which was produced by the German Federal Intelligence Service (Bundesnach- richtendienst, or BND) was leaked to the Reuters news agency and accessed by Germany’s Frankfurter Allgemeine Zeitung. It sides with other recent estimates, notably by the International Energy Agency, which suggest that the domestic oil production of the United States might exceed that of Russia and Saudi Arabia by the year 2020. The BND estimates that, through the technique popularly known as fracking (using pressurized fluid to cause horizontal fractures on underground rock layers), the US will be able to exploit oil and natural gas reserves on its territory that were previously considered inaccessible. This could transform the US from the world’s largest energy importer of energy to a net exporter of both oil and natural gas. According to the report, such a massive transformation of the global energy import-export balance could have “particularly dramatic consequences” in the realm of international relations. Most crucially, it could transform the existing balance of power between the US and China. Specifically, German intelligence analysts forecast that, as the US becomes increasingly self-sufficient in energy, it will limit its import of oil and natural gas to its neighboring countries, namely Canada and Mexico. This could potentially lead the US to gradually disengage from the Middle East, allowing Washington’s foreign policy “increased freedom of action” vis-à-vis energy-rich Arab nations and Israel. At the same time, more Middle Eastern oil will find its way to China, as the Far-Eastern country will emerge as the world’s largest importer of energy. Read more of this post